A San Mateo office complex is headed toward a new life after a takeover by Tourbineau Real Estate Partners.
The Seattle-based firm has acquired Tower Plaza, a five-building complex including a 12-story office tower at 2121 South El Camino Real, for $22 million, the San Francisco Business Times reported. The all-cash deal through a deed in lieu of foreclosure works out to around $106 per square foot and marks a steep discount from the $77 million price Rialto Capital Management paid for it in 2019 before defaulting on its loan and transferring ownership to TPG Real Estate Finance Trust.
The nearly 3.4-acre property spans 207,678 square feet and is Tourbineau’s first acquisition in San Mateo. The company is deciding how to proceed with redevelopment at the site, with proposals for apartments, hotel and mixed-use redevelopment retaining some offices.
The company views the complex as “an empty slate,” Ben Wong, chief investment officer for Tourbineau, told the Business Times.
“This was the one [property] we were most excited about,” he said.
Tower Plaza is nearly 80 percent vacant, speaking to the Bay Area’s high office vacancy rate in the post-pandemic era as companies downsized office space or went remote altogether. The San Francisco Peninsula closed the last quarter with a 24.3 percent office vacancy rate, according to CBRE.
Its location near the Hillsdale Caltrain station was reportedly an added draw for Tourbineau.
San Mateo voters last year passed Measure T, which lifts height and density limits near public transit. The El Camino Real corridor, running parallel to the Caltrain tracks, is still populated with strip malls and low-rise retail developments. The Tower Plaza makeover would be one of the largest potential office redevelopments in the city of San Mateo.
More than 3,700 housing units are in development across San Mateo. The city must plan to build 7,015 new homes by 2031, according to its Housing Element adopted in 2023.
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